IHC Buys Stake in Sammaan Capital for $1 Billion

Mumbai, Oct 2 (PTI) Abu Dhabi-based investor Avenir Investment RSC, an affiliate of International Holding Company, has agreed to purchase a 43.46 per cent stake in Sammaan Capital for USD 1 billion, the non-bank lender said on Thursday.

The lender, formerly known as Indiabulls Housing Finance, will be raising the capital by issuing preferential shares to Avenir after getting requisite approvals, as per an exchange filing.

IHC will foray into the financial services sector in India through the largest ever primary capital infusion by an investor in a non-bank financial company in India, according to a statement.

The deal is expected to fuel the next leg of growth for Sammaan Capital on the back of long-term patient capital, deeper access to low-cost liabilities and an improved credit rating, he said.

Post-preferential allotment, in which it will invest Rs 8,850 crore or USD 1 billion, Avenir will hold over 63 crore shares in the company, representing 43.46 per cent of the holding.

As per an agreement, 33 crore shares of the company will be issued to the investor at Rs 139 apiece to raise Rs 4,587 crore, while the rest will be through two tranches of warrants.

It will subscribe to 8.60 lakh warrants at the same price, with each carrying a right to subscribe to one equity share, which will help raise another Rs 1,207 crore, while another Rs 3,055 crore will be raised through the issue of 21.97 crore of similar warrants.

This will trigger an open offer as per the regulatory guidelines to acquire an additional 26 per cent, it said.

The filing also said that Avenir will "acquire and exercise" control of the company and eventually be classified as a promoter of the company.

Once it gets classified as a promoter, the agreement also provides for a change in the articles of association of the company and grants Avenir the right to nominate board members.

The Sammaan Capital scrip had closed 5.41 per cent up at Rs 169.55 apiece on the BSE on Wednesday.